In a series of Tuesday tweets, Jack Dorsey, the co-founder and former CEO of Twitter, as well as the founder and CEO of Square (now Block), voiced his criticism over the direction of Web 3.0 development. Elon Musk, the CEO of Tesla, joined Dorsey in the mockery. (On an unrelated note, the same day, Dorsey replied, "Bitcoin will" when asked if crypto will replace the dollar.)
Within context, Web 3.0 is a decentralized version of the virtual world that will, in part, feature public blockchains, metaverse technology, nonfungible tokens and decentralized finance free from the grasp of centralized power sources, such as corporate servers.
You don’t own “web3.”— jack⚡️ (@jack) December 21, 2021
The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label.
Know what you’re getting into…
However, Dorsey took aim at the fact that venture capital firms, or VCs, and limited partnerships, also known as LPs, frequently fund Web 3.0 projects in direct competition with decentralized alternatives such as initial coin offerings. By owning a controlling stake, VCs and LPs can pressure blockchain founders to comply with centralized regulations, such as collecting Know Your Customer (KYC) data, that conflict with their core crypto philosophy.
Although he didn't have much to add, Elon Musk commented that Web 3.0 projects haven't really lived up to their name.
Has anyone seen web3? I can’t find it.— Elon Musk (@elonmusk) December 21, 2021
According to a report by PitchBook, fintech firms received $88.3 billion in aggregate funding from venture capital through the first three quarters of 2021, almost double the 2020 total of $44.9 billion. The report also highlighted the growing mainstream acceptance of cryptocurrencies as one potential growth driver, especially as more institutions look to access digital assets.
As for Dorsey, the former Twitter CEO appears to be much more vocal about his intent to contribute to the Bitcoin (BTC) economy since stepping down from the social media company in November. As Cointelegraph previously reported, Dorsey plans on building a decentralized exchange for Bitcoin that will make it easier to fund a non-custodial wallet.